‘It’s so f**ked’: Channel Seven is in turmoil over a fresh scandal that insiders say is deeply damaging
Things continue to go from bad to worse for embattled Channel Seven, with the latest scandal surrounding the network putting it under further strain.
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“It’s so f**ked.”
That was the succinct description from a senior Channel Seven figure of the weeks of turmoil that have rocked the network.
On Wednesday, it emerged that Seven ordered two separate investigations into claims a small number of staffers at its top-rating breakfast show Sunrise had engaged in fraud.
The Sydney Morning Herald and The Age newspapers, owned by arch rival Nine, each ran front page stories and a double page spread inside about the extraordinary steps taken to keep the probes secret.
Among them, a fiery email from Seven’s commercial director Bruce McWilliam to a journalist chasing the story, in which he claimed her queries had resulted in Michael Pell, Sunrise’s long-time executive producer, self-harming.
“Why don’t you keep it up so he kills himself,” Mr McWilliam wrote in an October 5, 2022 message to Zoe Samios, who was a senior media reporter at the SMH at the time.
“You are a complete disgrace. If you publish untrue allegations … and he tops himself. It’s on you.”
Accompanying the extraordinary email was a graphic photograph of Mr Pell, taken in a hospital, in which he’s wearing a hospital gown and has a noticeable head wound.
Mr McWilliam exclusively told news.com.au that he viewed the reporting by Nine’s newspapers as a “pile on”.
“The war between Seven and Nine is toxic,” he said.
While the timing of Wednesday’s bombshell reporting blindsided senior executives at Seven, a source told news.com.au that most were waiting for details of the so-called secret investigations to emerge one day.
“This was always going to come out,” the source said.
But two years ago, when Mr Pell abruptly announced he was stepping away from the helm of Sunrise after 11 years – a move few in the media industry saw coming – those who worked closely with him were “none the wiser” about the probes.
Staff and other prominent figures from Seven gathered at The Ivy nightclub in Sydney in April 2022 for a send-off, as he prepared to relocate to Los Angeles for a new executive position with the network.
“No-one knew,” a senior staffer told news.com.au of the two investigations quietly ordered by Seven.
A month earlier, a law firm and an auditor began reviewing allegations that a small number of Sunrise staff, as well as some of their friends and family, had misused travel benefits provided to the network by Qantas as part of a multimillion-dollar advertising and sponsorship deal.
Findings were made and presented to Seven.
In the aftermath, a handful of employees exited the network and signed nondisclosure agreements on their way out the door.
A few months later, an anonymous source began approaching journalists with claims about the investigation, naming those alleged to have been the subjects of the probe.
In October 2022, Samios approached Seven with questions about the investigation and Mr McWilliam was incensed when Mr Pell’s name was mentioned, prompting his fiery email.
“The accusations against Michael were exaggerated,” he told news.com.au.
“I make no excuse for having acted to protect a colleague, against whom false allegations were being made. Michael Pell has been a friend of mine for many years.”
News.com.au has made repeated attempts to contact Mr Pell, who “amicably” left his role at Seven recently, but he did not respond.
However, news.com.au has confirmed that Mr Pell remained an employee of Seven, in his highly publicised role in the US, for a significant period of time after the investigations concluded.
News.com.au is not suggesting Mr Pell engaged in any wrongdoing.
Revelations on Wednesday came on the back of explosive claims made by a former producer of the network’s flagship current affairs program Spotlight in Federal Court that the show picked up the tab for a “rampaging” Bruce Lehrmann as it wooed him to secure an exclusive interview.
Taylor Auerbach, who was in discussions with Mr Lehrmann for a highly sought-after sit-down, claims the pair took drugs and partied with sex workers, with more $10,000 charged back to Seven.
A secret recording of Spotlight’s executive producer Mark Llewellyn during a meeting with staffers of the show spoke of the pressure to “do whatever it takes to get the story”.
But Mr Lehrmann denies the allegations, which were outlined in an affidavit by Mr Auerbach, and Seven has also challenged the claims.
The Sydney Morning Herald on Thursday reported Mr Llewellyn is set to leave Seven.
Marc C-Scott, deputy associate dean at Victoria University’s College of Arts and an expert in Australian television history, said the allegations made by Mr Auerbach were indicative of “where the industry is now and the trouble it’s facing”.
“Broadcast knew things were going to change but the industry didn’t necessarily want to change with it,” Dr C-Scott said.
“So, when streaming and alternative viewing platforms came out way back in 2008, television networks didn’t really do much. Then Netflix kicked off and they had a panic attack. Their point of difference remains live events and news, so they’ve gone all-in on that.
“That’s where we are now, where there’s intense competition among the free-to-air broadcasters to get hold of a smaller audience.”
So fierce is the competition that a “do what it takes” culture has become entrenched, simmering the kind of conduct alleged by Mr Auerbach.
“It shows how important it is to get a big news story in Australian media in the current environment, and potentially some of the lengths that staff will go to, to gain access to them.”
While the general public would be “shocked” by just how far some in television will go to land a scoop, it would come as little surprise to those within the industry, he said.
“We only have three commercial broadcasters in Australia. We only have a limited number of news outlets in terms of print or online media, and most of those are now connected with TV as well, and radio. It’s extremely competitive.”
Earlier this month, Seven chief executive James Warburton sent a memo to staff to insist Mr Auerbach’s claims were contrary to the broadcaster’s culture.
“Is it, though?” a senior television figure, not employed with Seven, told news.com.au. “This sounds like classic Seven.”
When former Special Forces soldier Ben Roberts-Smith launched defamation proceedings against Nine over reports in its newspapers that alleged he committed war crimes, including murdering civilians, while deployed to Afghanistan.
A court found Nine had proven Mr Roberts-Smith broke the rules of war and is a war criminal and murderer. He is appealing the ruling and maintains he is innocent.
The mammoth cost of the lengthy court battle is estimated to be more than $30 million. Footing the bill for Mr Roberts-Smith was Seven’s chairman Kerry Stokes.
The secretive financial arrangements were exposed after proceedings began, with Seven initially paying for lawyers until Mr Stokes was forced to absorb the costs into his private company.
Mr Roberts-Smith had been employed by the network as an executive in its Queensland operations. Mr Stokes remains an ardent supporter.
“Ben Roberts-Smith is innocent and deserves legal representation and that scumbag journalists should be held to account,” Mr Stokes said at Seven’s annual general meeting. “And quote me on that.”
Channel Seven was approached for comment but declined.
Originally published as ‘It’s so f**ked’: Channel Seven is in turmoil over a fresh scandal that insiders say is deeply damaging
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